Questor, Numis & others say BUY17 Sep 2013 14:30
Petra Diamonds
117½p-3½p
Questor says BUY
PETRA DIAMONDS, the FTSE 250 listed South African diamond miner, announced a sparkling set of results yesterday. So, after two years of the shares going sideways they are beginning to look cheap.
Shares in diamond miners have been in the doldrums due to falling prices. Prices for polished diamonds peaked at around $170 per carat in early 2011 and have been on a steady decline to around $140 per carat today.
“The rough diamond market is expected to stabilise for the year ahead due to constrained supply and a firmer US market, the world’s major market for polished diamonds, as well as continued growth in China, albeit at a lower rate than over recent years,” says Johann Dippenaar, chief executive.
With pricing stabilising, Petra has stepped up activity. Production increased by 21pc to 2.67m carats in the year to June, from 2.21m carats in the comparable period. Mr Dippenaar said that after two months of production he is confident of hitting 3m carats in the current year.